Reflections on White Collar Crime and Federal Criminal Law

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Barry Bonds Obstruction Case Splinters the Ninth Circuit

Baseball superstar Barry Bonds hit one final home run in the U.S. Court of Appeals for the Ninth Circuit last week. An eleven-judge panel threw out Bonds’ 2011 conviction on a single count of obstruction of justice. It was a 10-1 blowout, with only one judge believing that Bonds’ conviction should be upheld, but the case produced five different opinions totaling 75 pages. The amount of ink spilled was a bit remarkable, considering this should have been, as one of the judges put it, a “very simple case.”

In 2003 a grand jury in San Francisco was investigating whether Bonds’ trainer, Greg Anderson, and others had supplied illegal steroids to a number of professional athletes. Bonds was subpoenaed to testify in the grand jury and was granted immunity; prosecutors were not looking to charge him, they were interested in the information he had about Anderson. Ultimately, though, prosecutors concluded that Bonds lied in the grand jury and they indicted him on four counts of perjury and one count of obstruction of justice.

After years of pre-trial maneuvering the case went to trial in 2011. The government dismissed one of the perjury counts during the trial. The other three perjury counts resulted in a hung jury and were ultimately dismissed as well. The jury convicted Bonds only on the single obstruction of justice count.

The jury’s guilty verdict was based on what became known as the “celebrity child” response:

Q: Did Greg ever give you anything that required a syringe to inject yourself with?

A: I’ve only had one doctor touch me. And that’s my only personal doctor. Greg, like I said, we don’t get into each others’ personal lives. We’re friends, but I don’t we don’t sit around and talk baseball, because he knows I don’t want — don’t come to my house talking baseball. If you want to come to my house and talk about fishing, some other stuff, we’ll be good friends. You come around talking about baseball, you go on. I don’t talk about his business. You know what I mean?

Q: Right.

A: That’s what keeps our friendship. You know, I am sorry, but that — you know, that — I was a celebrity child, not just in baseball by my own instincts. I became a celebrity child with a famous father. I just don’t get into other people’s business because of my father’s situation, you see. So, I don’t know — I don’t know — I’ve been married to a woman five years, known her 17 years, and I don’t even know what’s in her purse. I have never looked in it in my lifetime. You know, I just — I don’t do that, I just don’t do it, and you know, learned from my father and throughout his career, you don’t get in no one’s business, you can’t — there’s nothing they can say, you can’t say nothing about them. Just leave it alone. You want to keep your friendship, keep your friendship.

The jury convicted Bonds of obstruction of justice based solely on this exchange. The trial judge upheld the conviction, and so did the initial three-judge panel of the Court of Appeals. That prompted the Court to grant further review by the eleven-judge en banc panel.

The Five Different Opinions

The statute Bonds was convicted of violating, 18 U.S.C. § 1503(a), punishes anyone who “corruptly . . . influences, obstructs, or impedes, or endeavors to influence, obstruct, or impede, the due administration of justice.” The court’s task was to determine whether a reasonable jury could have found that the “celebrity child” response, standing alone, violated this provision. Most of the judges agreed that the conviction had to be reversed because Bonds’ evasive answer was not “material” to the grand jury’s investigation – but that was where the agreement ended.

1) Chief Judge Kozinski, joined by four other judges, wrote the first opinion. Much of it was devoted to what he claimed are the dangers posed by the “vast” coverage of § 1503. Lawyers, he argued, are at particular risk: “Stretched to its limits, section 1503 poses a significant hazard for everyone involved in our system of justice, because so much of what the adversary process calls for could be construed as obstruction.” Arguing motions, questioning witnesses, or filing pleadings, he said, all could be considered endeavors to influence the due administration of justice and might end up being prosecuted.

The critical limitation on the statute, he argued, comes from the requirement that the obstructive conduct be material – that it had the “natural tendency to influence, or was capable of influencing, the decision of the decision making body.” Although the language of § 1503 (unlike the perjury statute, for example) does not require materiality, Judge Kozinski said Ninth Circuit precedent made materiality an element of the offense. Bonds’ single evasive (but truthful) answer during the course of several hours of testimony could not be considered capable of influencing the decision of the grand jury, and therefore was not material.

2) Judge N.R. Smith wrote the next concurrence, joined by three other judges. Judge Smith argued that the proper standard for materiality was the “nexus” requirement for obstruction cases announced by the Supreme Court in United States v. Aguilar: the conduct must have the “natural and probable effect” of obstructing justice. The “celebrity child” answer failed this nexus requirement because the natural and probable effect of an evasive answer is simply to elicit follow-up questions and clarification, not to obstruct the proceeding.

Judge Smith concluded that evasive or misleading testimony can only amount to obstruction when it completely thwarts the investigation and amounts to a refusal to testify. A single truthful but evasive answer cannot meet this standard.

3) Judge Reinhardt, writing only for himself, added a third concurrence. He disagreed with the unwarranted breadth of Judge Kozinski’s opinion and all of its speculation about the dangers of the statute. On the other hand, he disagreed with Judge Smith that at some point a refusal to testify could amount to obstruction of justice. According to Judge Reinhardt, the proper remedy in such a case would be a prosecution for contempt, not obstruction, and testimony or a refusal to testify alone could not constitute obstruction of justice.

4) Judge Fletcher, also writing only for himself, took a completely different approach. Tracing the history of the statute back to 1831, he argued that the term “corruptly” refers only to obstructing justice through bribery. Because Bonds did not bribe anyone in connection with the grand jury proceeding, his conduct did not violate § 1503.

5) Finally, Judge Rawlinson wrote as the sole dissenter. She argued the jury could have properly found that Bonds intended to obstruct the grand jury’s investigation through his evasive testimony and that the court was improperly second-guessing the jury’s verdict.

Breaking it Down – What’s the Right Approach?

It’s important to recall that the case before the Court of Appeals was not the case that the prosecutors brought. Much of the Court’s discussion makes it sound as though the prosecutors had indicted Bonds based only on this single evasive answer. In fact Bonds was charged with four counts of perjury and the obstruction of justice count was based on seven different exchanges in the grand jury. But the jury could not agree on the perjury counts and ultimately found that only the single “celebrity child” response constituted obstruction of justice.

To the extent the court’s opinions are seen as admonishing prosecutors for an unduly broad attempted application of § 1503, therefore, that criticism is misplaced. The prosecutors did charge a more substantial case, but were left to defend a verdict that relied only on the single, meandering, non-responsive answer. On appeal the government had to play the hand that the trial jury dealt for them – and it wasn’t a good one.

Judge Kozinski’s opinion, for example, contains a lot of sweeping rhetoric about the potential breadth and dangers of the statute that has nothing to do with the case – or with the real world. The idea that § 1503 makes “everyone who participates in our justice system a potential criminal defendant for conduct that is nothing more than the ordinary tug and pull of litigation” is simply overwrought hyperbole.

White collar crime statutes do tend to be written in broad strokes, because they have to cover a wide range of conduct that may fall within nebulous concepts such as “fraud” or “corruption.” One can always conjure up a parade of horribles that has little or nothing to do with the way the laws are actually enforced. The federal wire fraud statute, for example, would potentially apply to any employee who called in sick in order to go to the ballgame, and yet we don’t see such cases clogging the courts.

The obstruction of justice statute in its current form has been around for more than a hundred years and there has been no epidemic of courtroom advocates being prosecuted based on ordinary, even aggressive, advocacy. Yet Judge Kozinski felt obligated to argue that all lawyers are in danger because the statute potentially “gives prosecutors the immense and unreviewable power to reward friends and punish enemies by prosecuting the latter and giving the former a pass.” This has nothing to do with the facts of the Bonds case or with any existing problem with § 1503 – but it does dovetail nicely with the “bad prosecutor” meme that is so popular among many these days, including Judge Kozinski.

The second flaw in Judge Kozinski’s opinion is that the solution he offers to the statute’s breadth — the requirement of materiality — would do nothing to prevent the prosecutions he purports to fear. Almost anything done by an advocate in the “ordinary tug and pull of litigation” would have the potential to influence the proceeding and would thus be material. The reason such cases are not prosecuted is that routine advocacy is not “corrupt” behavior under the statute — and because prosecutors properly exercise their discretion not to bring them. All of Judge Kozinski’s speculations about the dangers of the statute are therefore irrelevant not only to the case but also to the solution he proposes.

At the same time, Judge Kozinski offered a startling example of his own expansive view of § 1503. Suppose, he suggested, that in response to whether Greg ever gave him anything to inject himself with, Bonds had replied “I’m afraid of needles” rather than by giving his “celebrity child” response. Judge Kozinski suggested such an answer might constitute obstruction, because it implies a negative response.

The Supreme Court made it clear in the leading perjury case of Bronston v. United States that a merely evasive answer cannot be perjury. Perjury requires proof of actual falsity, and if a witness evades it is the duty of the questioner to detect it and pin the witness down. An answer may be non-responsive due to deliberate evasion, but it also may be due to nerves, miscommunication, or a misunderstanding of the question. Stringent proof requirements for perjury are therefore required so that witnesses are not chilled from testifying out of fear that an answer that is less than perfectly responsive might later be charged as perjury.

The Court in Bronston expressly rejected the idea of “perjury by negative implication” – perjury based on an answer that simply implied something that wasn’t true. Judge Kozinski, however, seemed to open the door to the idea of obstruction of justice by negative implication. As I’ve argued elsewhere, if that were the law then all of the safeguards that Bronston put in place to protect testifying witnesses would be out the window because prosecutors unable to prove perjury could simply charge obstruction of justice instead. It’s odd that Judge Kozinski expresses so much concern about the potential breadth of the statute but then offers his own hypothetical that truly would represent a sweeping expansion of the crime of obstruction of justice.

Of the two main opinions, Judge Smith’s has the better analysis. First, I think he’s correct that the proper standard for materiality is the Aguilar “natural and probable effect” test, not Judge Kozinski’s materiality test. Although some have argued, like Judge Kozinski, that there should be a separate materiality requirement for obstruction of justice, it’s not necessary. The “natural and probable effect” nexus requirement subsumes materiality within it, because it’s impossible for conduct to meet the nexus requirement and not be material. Adding a separate requirement of materiality is simply redundant. In fact, the nexus requirement provides greater protection for defendants than materiality: although any conduct that satisfies the nexus requirement will always be material, it’s easy to envision conduct that would be material to an investigation but that is so removed or remote from the investigation that it fails the nexus requirement.

I think Judge Smith is also correct that the “natural and probable effect” of a single, truthful but evasive answer can probably never be to obstruct justice, given the nature of the adversary system. As he argued, the natural and probable effect of such an answer is to inspire more probing and follow-up questions, as indeed happened during Bonds’ grand jury appearance. There’s almost no way that a single evasive answer would thwart the grand jury’s work.

At the same time, I believe Judge Smith is also correct that in certain cases evasion can constitute obstruction of justice. If a witness continually refuses to be pinned down and to answer questions directly they are not merely being evasive, they are essentially refusing to testify. At some point such conduct crosses the line into corrupt behavior that thwarts the investigation and may amount to obstruction.

Because I agree with Judge Smith that sometimes extreme evasion can rise to the level of obstruction, I disagree with Judge Reinhardt’s concurrence. And Judge Fletcher’s historical analysis was very interesting, but if he’s correct that “corruptly” requires bribery then obstruction of justice would not even apply to classic obstructive behavior such as shredding documents that have been subpoenaed by a grand jury. I think that ship has sailed.

* * *

Whether one focuses on the “natural and probable effect” test or on the requirement of “corrupt” behavior, the outcome is the same: one truthful, meandering, non-response by Bonds could not have had any real impact on the grand jury’s investigation. Once the jury convicted based only on that single exchange, the verdict was doomed.

This case doesn’t have sweeping implications for the law of obstruction of justice or for the adversary system. It didn’t call for a judicial rebuke of the prosecutors or yet another cautionary tale about a criminal justice system run amok. In the end, it’s all about the facts of one case and the basis of the jury’s verdict. And as a factual matter, there’s simply no way that Bonds’ single, truthful answer could have obstructed that grand jury proceeding.

It really should have been a simple case. There’s no reason that Judge Smith’s concise, eight page analysis could not have been the opinion for the entire court. It’s surprising the Ninth Circuit saw the need to take it into extra innings.

Update: on July 21, federal prosecutors announced they would not seek to appeal the Ninth Circuit’s decision to the U.S. Supreme Court, thus bringing the Barry Bonds obstruction of justice case to a close.